Exhibit 10.1

[**] The confidential portion has been omitted and filed separately withthe Securities and Exchange Commission.

**VERSICOR MANUFACTURING, DEVELOPMENTAND SUPPLY AGREEMENT**

             **ThisManufacturing, Development and Supply Agreement**(the “Agreement”) isentered into this 25th day of June, 2001, and effective December 11,  2000 by and between **Abbott Laboratories**, an Illinoiscorporation having a principal place of business at 100 Abbott Park Road,Abbott Park, Illinois  60064-3500(“Abbott”), and **Versicor, Inc**., aDelaware corporation, having a principal place of business at 34790 ArdentechCourt, Freemont California 94555 (“Versicor”).

             **WHEREAS**,Eli Lilly Industries, Inc. is the owner or licensee of certain technology andpatent rights regarding ECBN-HCl (as defined below) and API (as defined below),and the manufacturing processes relating thereto;

             **WHEREAS**,Lilly has granted to Versicor a worldwide license to develop, manufacture andsell an injectable form of API; and

             **WHEREAS**,Versicor will file for approval with the United States Food and DrugAdministration (and its foreign equivalents) (the “FDA”), a New DrugApplication (and its foreign equivalents) (an “NDA”), and Investigational NewDrug Applications (“INDs”) for certain formulations containing API, (as definedbelow); and

             **WHEREAS**,Versicor has certain process information relating to the synthesis of ECBN-HCl(as defined below) and API; and

             **WHEREAS**, Abbott possesses process engineering capabilitiesand operates process development facilities, which include small scaleproduction and pilot plants, as well as large scale facilities for manufactureof commercial quantities of certain ECBN-HCl and API; and

             **WHEREAS**,the parties desire to have Abbott evaluate Versicor’s process information andto scale-up and adapt the current manufacturing process for the preparation ofECBN-HCl and API licensed to Versicor by Lilly to Abbott facilities; and

             **WHEREAS**,Abbott desires to manufacture for Versicor developmental, clinical andcommercial quantities of ECBN-HCl and API and Versicor desires to purchase fromAbbott such quantities.

             **NOW,THEREFORE**, in consideration of the premises and the mutual covenantsand agreements contained herein, the parties hereto agree as follows:

1.          **Definitions**

Asused in this Agreement, the following words and phrases shall have thefollowing meanings:

             1.1        “**AbbottKnow-How**” means all non-patented technical data, processinginformation, drawings, documentation, analytical and regulatory information andother information, including all improvements thereto, not included in AbbottPatent Rights, as defined below, covering manufacturing and process andECBN-HCl and API development operations relating to the manufacture of ECBN-HCland API according to the process developed hereunder by Abbott for Versicor,that is owned by Abbott, or licensed to Abbott, with the right to sublicense,as of the Effective Date, as defined below, or generated or acquired by Abbottduring the term of this Agreement.

             1.2        “**AbbottPatent Rights**” means United States and foreign patents and patentapplications, including divisions, continuations, continuations-in-part,additions, renewals, extensions, re-examinations and reissues of all suchpatents and patent applications, all as are owned by Abbott, or licensed toAbbott, as of the Effective Date, with the right to sublicense, claimingmanufacturing and/or process development operations relating to the manufactureof ECBN-HCl and API according to the process adapted hereunder by Abbott for Versicor.

             1.3        “**Affiliate**” of a party hereto means anyentity that controls, is controlled by, or is under common control with suchparty.  For purposes of this definition,a party shall be deemed to control another entity if it owns or controls,directly or indirectly, at least fifty percent (50%) of the voting equity ofthe other entity (or other comparable ownership interest for an entity otherthan a corporation).

             1.4        “**API**”, “**LY303366**”or “**VER002**” means the bulk form ofthe final active pharmaceutical ingredient, Anidulafungin, which is issued as adrug for Candidiasis, Aspergillosis and other fungal infections, as more fullydescribed in Exhibit A.

             1.5        “**cGMP**” means the FDA’s current goodmanufacturing practices for drug products, as specified in the Code of FederalRegulations and FDA’s guidance documents, and all successor regulations, ordersand guidance documents thereto.

             1.6        “**CMC**” means the Chemistry and ManufacturingControls (or its foreign equivalents) filed with the FDA in support of the  NDA, IND or DMF.

             1.7        “**Confidential Information**” means allinformation, including, but not limited to, Versicor Know-How and AbbottKnow-How disclosed pursuant to this Agreement in writing (or all informationdisclosed orally, visually, in writing and/or in another tangible form, exceptany portion thereof that:
|   | (a)                           |   | is known to the  recipient, as evidenced by its written records before receipt thereof under  this Agreement;                                                              |
|--------|-------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                          |   |                                                                                                                                                                       |
|   | (b)                           |   | is disclosed to the  recipient without restriction after acceptance of this Agreement by a third  person who has the right to make such disclosure;                        |
|   |                          |   |                                                                                                                                                                       |
|   |      (c ) |   | is or becomes part of the public domain through  no fault of the recipient;  or                                                                                       |
|   |                          |   |                                                                                                                                                                       |
|   | (d)                           |   | is independently  developed by or for the recipient by individuals or entities that have not  had access to Confidential Information, as evidenced by its written records. |

             1.8        “**Contract Year**” shall mean [**].

             1.9        “**DMF**” means the Drug Master File filed withthe FDA in support of the NDA .

             1.10       “**ECBN-HCl**” meansthe bulk form intermediate Echinocandin B Nucleus hydrochloride used in theproduction of API as more fully described in Exhibit B.

             1.11      “**ECBN-HCl Specifications**”and/or  “**API Specifications**” (hereinafter collectively referred to asthe “**Specifications**”) means thewritten specifications for API and the ECBN-HCl.  The API Specifications are set forth in Exhibit C as of the datehereof.  The ECBN-HCl Specificationsshall be added to Exhibit C of this Agreement at a later date, upon theirapproval in writing by both parties. The Specifications may be modified from time to time pursuant to Section7.2 of this Agreement, by written agreement of the parties.  Neither the addition of the ECBN-HClSpecifications, or any modification to the Specifications, shall require aformal amendment to this Agreement.

             1.12      “**Effective Date**”means December 11, 2000.

             1.13      “**EMEA**” shall mean the European Medicine Evaluation Agency, orany successor entity thereto.

             1.14      “**FDA**” means theUnited States Food and Drug Administration (or its foreign equivalents), or anysuccessor entity thereto.

             1.15      “**IND**” means anInvestigational New Drug Application(orits foreign equivalent) filed with the FDA.

             1.16      “**Launch Date**”means the date on which the first commercial sale of Product is made in theTerritory by Versicor.

             1.17      “**NDA**” means the New Drug Application (or its foreignequivalent) filed with or to be filed by Versicor with the FDA, seekingauthorization to market Product in the Territory.

             1.18      “**Product**” means any finished pharmaceutical product containingAPI as its active ingredient.

             1.19      “**Project**” means amulti-stage project to adapt the process for the manufacture of ECBN-HCl andAPI.

             1.20      “**Proposal**” meansthe description of the Project, as set forth in Exhibit D.

             1.21      “**Regulatory Filings**” means the governmental filings required toobtain approval to market Product in a given country, including, but notlimited to, Product registration(s) and marketing approval(s), as applicable,in each country.

             1.22      “**Regulatory Authorities**”means the FDA, the EMEA, or any comparable national or territorial regulatoryentity.

             1.23      “**Stability Protocol**”means the document created by Abbott personnel and reviewed by Versicor, or anyof its CMC consultants that controls the details of collection and analysis ofsamples by the Quality Control group of Abbott.

             1.24      “**Territory**”  means the world.

             1.25      “**Versicor Know-How**”means all non-patented technical data, processing information, drawings,documentation, analytical and regulatory information, oral data and otherinformation, including all improvements thereto, not included in VersicorPatent Rights, as defined below, relating to the manufacture, use or sale ofECBN-HCl or API that is owned by Versicor, or licensed to Versicor, with theright to sublicense, as of the Effective Date, or generated or acquired byVersicor during the term of this Agreement.

             1.26      “**Versicor Patent Rights**”means United States and foreign patents and patent applications, includingdivisions, continuations, continuations-in-part, additions, renewals,extensions, re-examinations and reissues of all such patents and patentapplications, all as are owned by Versicor, or licensed to Versicor, with theright to sublicense, claiming ECBN-HCl and API, and under which Abbott wouldneed a license or sublicense to lawfully manufacture ECBN-HCl and API forVersicor under this Agreement.

2.          **ECBN-HCland API Development Project**.

             Promptly after the Effective Date,Abbott shall undertake the Project.  TheProject shall consist of research and development activities described in the Proposalin accordance with Exhibit D.  Abbottshall use its reasonable best efforts in performing its research anddevelopment activities hereunder, but Versicor understands that, because theProject involves research from which the results are inherently uncertain,Abbott cannot and does not make any representation, warranty or guarantee ofany kind that the Project will result in a commercially-viable process.

3.          **Abbott’sResearch and Development Activities**.

             3.1        **Abbott’s Activities**.  Abbott shall use its reasonable best effortsto conduct and perform certain activities including, but not limited, to thefollowing:
|   |       a. | Source raw materials  for use in manufacturing ECBN-HCl and API;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--------|-----------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       b. | Chemically synthesize  the ECBN-HCl to form the API;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       c. | Perform pilot scale  evaluation of Versicor’s manufacturing process;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       d. | Adapt Versicor’s  manufacturing process to Abbott’s equipment and systems;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       e. | Develop process  parameters to manufacture ECBN-HCl and API in Abbott’s manufacturing  facility;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       f. | Prepare suitable  manufacturing instructions and manufacturing controls for inclusion in  Regulatory Filings;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       g. | Provide appropriate  Regulatory Authorities with letters of authorization referencing Abbott's DMF  and containing process validation data, batch documents and other data  required to support Regulatory Filings and to provide timely notice to  Versicor of any significant changes in Abbott’s process development and  production activities (whether or not referred to herein) to enable Versicor  to amend the appropriate Regulatory Filings and to assist Versicor in  responding to questions from Regulatory Authorities concerning the ECBN-HCl  and API;                                                                                                                               |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       h. | Conduct material  contact and cleaning validation studies, engineering and validation runs,  process validation studies, and preparing process justification and  validation summary reports, in a timely manner, to pass FDA pre-approval and  other appropriate Regulatory Authority inspections to support manufacture of  the ECBN-HCl and API in the Abbott manufacturing facility, and either (i)  provide Versicor with copies of such reports and studies, in a timely manner  to enable Versicor to make all appropriate Regulatory Filings, or (ii) allow  Versicor to refer to Abbott’s Type II DMF containing such information and  permitting Versicor to have access to such documents; |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       i. | Permit Versicor to  conduct all necessary cGMP and quality assurance reviews of Abbott facilities  and documentation in accordance with Section 8.4 hereof, including review and  receipt of copies of Abbott manufacturing instructions (both prior to and  after the manufacturing process), and to provide notice to Versicor so as to  permit Versicor to have a representative in Abbott’s manufacturing plant at  the time of critical operations upon the mutual agreement of the parties,  which consent by Abbott shall not be unreasonably withheld and at Versicor’s  cost;                                                                                                           |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       j. | Permit Versicor to use  and access Abbott’s data and development reports, including, but not limited  to, the DMF and compounds as they relate solely to the manufacture of  ECBN-HCl and API;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       k. | Provide Versicor with  acceptable environmental impact statements for inclusion with Regulatory  Filings, if required;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       l. | Provide Versicor with  appropriate pilot and commercial scale batch record manufacturing  documentation for Regulatory Filings;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       m. | Conduct all stability  testing on ECBN-HCl and/or API and compile data for Regulatory Filings;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       n. | Prepare and administer  the FDA pre-approval inspection; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |       o. | Manufacture  development supplies, clinical supplies, stability supplies and process  validation batches of ECBN-HCl and/or API in accordance with current cGMPs  and pursuant to protocols to which the parties shall mutually agree.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |

4.          **Versicor’sResearch and Development Activities**.

             4.1        **Versicor’s Activities**.  Versicor shall use its reasonable bestefforts to conduct and perform research and development activities, includingthe following:
|   |                              |       a.                                                                                                                                              | Provide Abbott with  applicable and available analytical methods for raw materials, in-process  tests and manufacture of ECBN-HCl and/or API and all available reference  materials;                                                                                                                                    |
|--------|-----------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                              |                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                    |
|   |                              |       b.                                                                                                                                              | Provide Abbott with technical data on ECBN-HCl  and/or API that includes, but is not limited to, the following:  (i) material safety data sheets with  environmental and safety information, and (ii) additional detailed data, if  necessary, to define potential hazards and establish employee exposure levels; |
|   |                              |                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                    |
|   |                              |       c.                                                                                                                                              | Provide Abbott with copies of Regulatory Filings  as necessary for Abbott to obtain regulatory pre-inspection approval;                                                                                                                                                                                                 |
|   |                              |                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                    |
|   |                              |       d.                                                                                                                                              | Maintain a stability program for, and retain  samples of, the ECBN-HCl and/or API; and                                                                                                                                                                                                                                  |
|   |                              |                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                    |
|   |       e. | Provide Abbott with such additional information  as Abbott may reasonablyrequest, including but not limited to:  process, product, and safety/toxicity  information. |
|        |                                   |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                         |

5.          **Payment for Abbott’s Development Efforts**

             5.1        **Research and Development Fee**.  In consideration of select activities thatAbbott shall perform under Articles 3 and 4 hereof, Versicor shall pay Abbott anon-refundable research and development fee of [**] U.S. Dollars(U.S. $[**]).  In the event that Abbottdoes not receive complete, validated reference standards in Abbott specifiedamounts from Eli Lilly or other third parties, and it becomes necessary forAbbott to perform additional research and development, Versicor shall pay toAbbott an amount, not to exceed [**] U.S. Dollars (U.S. $[**]) as setforth on Exhibit D.  This “not toexceed” amount is currently reflected in Exhibit E.  The total research and development fees charged to Versicor underthis Agreement shall not exceed [**] U.S. Dollars (U.S. $[**]), excludingall raw materials other than [**] and additional charges, if any, incurredpursuant to Sections 5.2 and 5.3 below. Unless instructed by Versicor, the total fees to be paid by Versicorunder Exhibit E in Contract Years [**] shall not exceed the amounts set forththerein.  If reference standardproduction fees are incurred in [**], Abbott shall adjust other feesaccordingly to assure that the total annual charges do not exceed the totalannual charges set forth in Exhibit E. The parties shall agree to any additional changes in the research anddevelopment scope and commercial production activities that are not coveredherein.  The research and developmentfee shall be paid to Abbott in accordance with Exhibit E.

             5.2        **Changes in Project Scope**.  If changes occur in the Project or Specifications,or if technical difficulties require that Abbott perform either additional workor repeat work, unrelated to Abbott’s fault or negligence, or if Abbottreclassifies the ECBN-HC1 or ABI, or if the ECBN-HC1 or ABI is found to be askin sensitizor dictating specific containment necessary for manufacturing,Abbott shall provide Versicor with new or revised activities and priceestimates for such work.  The currentAbbott drug classification is Level 2 based on the toxicology informationprovided by Lilly.  If Versicor approvessuch estimates and activities, Abbott shall perform such work and shall invoiceVersicor for such work.  Versicor shallremit payment on such invoice within [**] of receipt of such invoice.  Reimbursement for such additional work shallbe at the rate of [**] U.S. Dollars (U.S. $[**]) per hour per person, plusout-of-pocket costs for reasonable travel and sustenance, materials andsupplies.

             5.3        **Additional Costs**.  Versicor shall pay Abbott for its directcosts pre-approved by Versicor associated with any FDA filing by Abbottrequested by Versicor including but not limited to the filing of a CMC or CMCamendment, in support of Versicor’s FDA filing with respect to ECBN-HCl, APIand/or Product.  Versicor also shall payAbbott’s direct costs pre-approved by Versicor for any work requested byVersicor to produce and assemble documentation for Productregistrations outside the United States.

6.          **Pilot Scale and Clinical Supplies**.
|   |       6.1 | **Year  [**] Clinical Supplies**.                                                                                                                                                                                                                                                                                  |
|--------|------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                               |                                                                                                                                                                                                                                                                                                               |
|   |       a.  | **API**.  Abbott  shall provide to Versicor [**] pilot scale lots of API, with each lot  consisting of [**] to [**] of API, using ECBN-HCl provided by Versicor.                                                                                                                                              |
|   |                               |                                                                                                                                                                                                                                                                                                               |
|   |       b.  | **ECBN-HCl**.  Abbott  shall provide to Versicor [**] cGMP lots of ECBN-HCl with each lot consisting  of enough material to prepare [**] lots of approximately [**]  of API.   Versicor shall notify Abbott regarding any alteration of the clinical  schedule and ECBN-HCl and API amounts needed. |

             6.2        **Revisions to Schedule**.  If necessary, a revised pilot scale andclinical development schedule will be mutually negotiated by the parties.  In the event that there is a change in thepilot scale and clinical development schedule that has not been communicated byVersicor to Abbott upon at least [**] prior written notice, the parties shallmutually agree to an allocation of the costs associated with revisions to suchschedule.

7.          **Manufactureand Commercial Supply of ECBN-HCl and API**.

             7.1        **Purchaseand Sale of ECBN-HCl and API**.  Pursuant to the termsand conditions of this Agreement, Abbott shall manufacture, sell and deliverECBN-HCl and API exclusively to Versicor and, Versicor may but shall not beobligated to purchase from Abbott any of its requirements of ECBN-HCl andAPI(other than the purchase of approximately [**] of commercial validationmaterials as provided in Section 5.1 and Exhibit E); provided, however, fromand after the date the parties mutually agree on an acceptable price forcommercial supplies of API, Versicor shall purchase from Abbott, at an amountnot to exceed such price, a minimum of [**] of its commercial requirements ofECBN-HCl and API in the Territory.  Inthe event that Abbott is unable to deliver a scheduled shipment of ECBN-HCl orAPI for any reason and is unable to cure such failure by delivering to Versicorthe scheduled shipment of ECBN-HCl and API within [**] of such scheduledshipment date, Versicor shall have the right to purchase its remaining ECBN-HCland API requirements in the Territory from secondary sources until Abbott becomesable to meet said requirements. Versicor may elect to designate, qualify and enable a secondary supplierat any time during this Agreement.

             7.2        **Modificationof Specifications**.  If the Specifications are modified byVersicor hereunder, or the Specifications must be modified by requirement ofthe FDA or other regulatory agency, or a process change would be required underthe CMC, or other applicable governmental application, and such modification orprocess change increases or decreases Abbott's cost to manufacture ECBN-HCl orAPI, Abbott shall submit to Versicor a revised price for either the current orfuture stage of development or ECBN-HCl or API that reflects such cost increaseor decrease.  Abbott and Versicor shallmutually agree on the cost allocation of such change.  In the event the parties are unable to agree on such costallocation, either party may seek to have the dispute resolved in accordancewith the provisions of Section 18.2 hereof. If such modification results in the requirement to reprocess and/orretest previously manufactured and otherwise acceptable ECBN-HCl or API, anyadditional costs incurred by Abbott in such reprocessing and/or retesting shallbe paid by Versicor upon submission by Abbott of documentation and justificationof such costs.

             7.3        **Modificationof ECBN-HCl or API Process**. Process changes by Abbott that effect Versicor’s ECBN-HCl or API DMF orCMC shall not occur without prior written permission of Versicor.

             7.4        **ValidationProduction Runs**.  Abbottwill make [**] production runs of API starting from the initial fermentation,and ending with the chemical synthesis steps (“Validation ProductionRuns).   The Validation Production Runswill be conducted at the desired and agreed upon production batch size and maybe used for validation and/or commercial market supply needs as determined bythe parties.
|   |       a. | The Validation  Production Runs will be conducted at the Abbott facility in North Chicago and  directed by an accompanying Protocol.   A completed, signed copy of the Protocol which will be generated by  Abbott personnel and approved in writing by Versicor will be forwarded to  Versicor for inclusion in the NDA. |
|--------|-----------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                              |                                                                                                                                                                                                                                                                                                                           |
|   |       b. | The Validation  Production Runs produced by Abbott will meet API Specifications and an Abbott  Certificate of Analysis will be generated for each lot.                                                                                                                                                                         |
|   |                              |                                                                                                                                                                                                                                                                                                                           |
|   |       c. | At the conclusion  of the Validation Production Runs a validation report will be generated by  Abbott.  A copy of this report will be  signed, dated and sent to Versicor for inclusion in the NDA.                                                                                                                       |
|   |                              |                                                                                                                                                                                                                                                                                                                           |
|   |       d. | Abbott shall ship  the API generated from the Validation Production Runs to a Versicor specified  drug Product formulation facility upon written notice by Versicor and  completion by Abbott.                                                                                                                                 |
|   |                              |                                                                                                                                                                                                                                                                                                                           |
|   |       e. | EBC and API  produced by Abbott under this Section 7.4 will be placed on stability at an  appropriate location under real time and accelerated conditions.                                                                                                                                                                     |

8.          **Manufactureof ECBN-HCl and Bulk Drug Substance API**.

             8.1        **ECBN-HCl and****API Title and Shipment**.  Any ECBN-HCl and API manufactured by Abbottpursuant to this Agreement shall be shipped F.O.B. Abbott’s manufacturingfacility.  Title and risk of loss shallpass to Versicor upon delivery of ECBN-HCl and/or API to the carrier.  Shipment shall be via a carrier designatedby Versicor.  All shipment costs shallbe borne by Versicor.

             8.2        **ECBN-HCl and API Storage**.  Versicor shall pay Abbott at a rate of [**]U.S. Dollars (U.S.$[**]) per month for any ECBN-HCl and/or API storage costsincurred by Abbott in excess of [**] after manufacture, provided that suchECBN-HCl or API was forecasted by Versicor.

             8.3        **Quality Control**.  Abbott shall apply its quality controlprocedures and in-plant quality control checks on the manufacture of ECBN-HClor API for Versicor in the same manner as Abbott applies such procedures andchecks to material of a similar nature manufactured for sale by Abbott.  In addition, Abbott will test and releaseECBN-HCl and/or API to Versicor in accordance with the Specifications describedin Exhibit C.

             8.4        **Audits**. Upon Abbott’s written approval,which approval shall not be unreasonably withheld or delayed, Versicor shallhave the right, upon [**] prior written notice to Abbott, to conduct duringnormal business hours a quality assurance audit and inspection of Abbott’srecords and ECBN-HCl and/or API facilities relating to the manufacture ofECBN-HCl and/or API, and to perform follow-up audits as reasonablynecessary.  Such audits and inspectionsmay be conducted from time to time on a reasonable basis prior to ECBN-HCland/or API production of the first commercial API order placed by Versicor andthereafter once each Contract Year.  Theduration of such audits shall not exceed [**] and such audits shall beperformed by no more than [**], unless Versicor reasonably believes that alonger audit or additional personnel are necessary and provides its reasons forsuch belief to Abbott in writing.  IfVersicor wishes to perform audits more often than once per year or over aperiod in excess of [**], Versicor shall pay Abbott [**] U.S. Dollars (U.S.$[**]) per additional audit day. Notwithstanding the foregoing, in the event that an audit is required byVersicor due to quality issues that arise during any Contract Year, Versicorshall be entitled to conduct such audit free of charge.  If more than [**] perform the audit,Versicor shall pay Abbott [**] U.S. Dollars (U.S. $[**]) per additionalauditor.

             Visits by Versicor to Abbott’sECBN-HCl or API facilities may involve the transfer of ConfidentialInformation, and any such Confidential Information shall be subject to theterms of Article 11 hereof.  The resultsof such audits and inspections shall be considered Confidential Informationunder Article 11 and shall not be disclosed to third persons, including but notlimited to the FDA and any other Regulatory Authority, unless required by lawand upon prior written notice to Abbott. If Versicor utilizes auditors that arenot employees of Versicor, each of such auditors shall execute a non-disclosureagreement with confidentiality terms at least as stringent as those set forthherein.

             Abbott shall be responsible forinspections of its North Chicago manufacturing facility by the FDA or anequivalent Regulatory Authority and shall notify Versicor of all inspectionsthat are directly related to the manufacture of ECBN-HCl or API within [**] orreceipt by Abbott of notice of such inspections

             8.5        **Payment Terms**.
|   |       a. | **Price  and Payment**.  Abbott shall invoice Versicor upon  delivery of ECBN-HCl and/or API by Abbott at the prices set forth in Exhibit  E of this Agreement.  Versicor shall  make payment net [**] from the date of receipt of Abbott’s invoice.  All payments due under this Agreement  shall be paid in U.S. Dollars by wire transfer or by such other means agreed  upon by the parties, in each case at the expense of the payor, for value no  later than the due date thereof (with [**] advance notice of each wire  transfer) to the following bank account or such other bank accounts as the  payee shall designate in writing within a reasonable period of time prior to  such due date: |
|--------|-----------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |                              | Account Name:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Abbott Laboratories |
|   |                              | Account Number:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | [**] |
|   |                              | Bank:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | [**] |
|   |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | New York,  New York |
|   |                              | ABA Number:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | [**] |
|   |       b. | **Taxes**.  Any  federal, state, county or municipal sales or use tax, excise, customs charges,  duties or similar charge, or any other tax assessment (other than that  assessed against income), license, fee or other charge lawfully assessed or  charged on the manufacture, sale or transportation of ECBN-HCl and/or API  sold pursuant to this Agreement shall be paid by Versicor.                                                                                                                                                                                                                                                                                                                             |

 

9.          **Orders and Forecasts**.

             9.1        **First [**] Estimate**.  Versicorshall, within [**] after filing its NDA for the Product, provideAbbott with a written estimate of Versicor’s monthly requirements of ECBN-HCland API to be supplied by Abbott for the [**] period commencing on the Launch Date.  Abbott acknowledges that such quantities areestimates only and are not binding.

             9.2        **Rolling Forecast**.  Thereafter, Versicor shall provide [**] toAbbott rolling [**] projections of requirements of ECBN-HCl and API tobe manufactured by Abbott, with the first [**] of such projection consisting of firm purchaseorders and the remaining [**] of each projection consisting of Versicor’s bestestimate forecast of its ECBN-HCl and API requirements.

             9.3        **First Firm Order**.  Abbott and Versicor shall cooperate fully inestimating and scheduling production for the first commercial order of ECBN-HCland API to be placed by Versicor with Abbott in anticipation of regulatoryapproval of Product.  The first firmorder shall cover the [**] period commencing on the Launch Date.  Versicor shall place its first firm orderfor ECBN-HCl and API approximately [**] in advance of the anticipated NDA approval date or desired APIavailability date.  At the same time,Versicor shall provide to Abbott Versicor’s estimate of its monthlyrequirements of ECBN-HCl and API to be supplied by Abbott for the nextsucceeding [**] calendar month period.  Each Firm Order submitted by Versicor shall be no less than [**] percent ([**] %) nor more than [**] percent ([**]%) of the most recent forecast covering such timeperiod.

             9.4        **Purchase Order Acceptance**.  Within [**] after receipt of Versicor’s firmpurchase orders for ECBN-HCl and API, Abbott shall confirm to Versicor itsacceptance of the purchase order, delivery date and quantity of ECBN-HCl andAPI ordered by Versicor.

             9.5        **Firm Order Changes**.  If, due to significant unforeseencircumstances, Versicor requests changes to firm orders within the [**] firm purchase order timeframe, Abbott shallattempt to accommodate the changes within reasonable manufacturing capabilitiesand efficiencies.  Abbott shall adviseVersicor of the costs associated with making any such change and Versicor andAbbott shall mutually agree to proceed with changes at Versicor’s cost.

             9.6        **Purchase Order Terms**.  Each purchase order or any acknowledgmentthereof, whether printed, stamped, typed, or written shall be governed by theterms of this Agreement and none of the provisions of such purchase order oracknowledgment shall be applicable except those specifying ECBN-HCl and/or APIquantities ordered, delivery dates, special shipping instructions and invoiceinformation.

10.        **ProprietaryOwnership of Development Work, Preexisting Technology and License Grants**

             10.1      **Existing ProprietaryInformation**.  Except asotherwise provided herein, neither party hereto shall be deemed by thisAgreement to have been granted any license or other rights to patent rightsexisting as of the date hereof, or know-how relating to compounds,formulations, or processes that are owned or controlled by the other party.

             10.2      **Abbott Inventions**.  With respect to any ideas, innovations orinventions (whether or not patentable) developed by Abbott during the term ofthis Agreement and relating to the manufacturing process of ECBN-HCl and/orAPI, Abbott shall own all proprietary rights to such ideas, innovations andinventions, and may obtain patent, copyright, and/or other proprietaryprotection relating to such ideas, innovations and inventions; providedhowever, that Abbott shall grant to Versicor a worldwide exclusive license,with the right to grant sublicenses, to any ideas, innovations or inventionsdeveloped hereunder as they relate to the manufacturing process of ECBN-HCl orAPI.  In the event that Versicorutilizes a third party in the manufacture of ECBN-HCl or API, Versicor shallpay Abbott an innovation transfer payment (“ITP”) to be mutually agreed upon bythe parties in an amount no more than [**] percent of the dollar volume of ECBN-HCland API purchased by Versicor from a third party utilizing such licensedtechnology solely for the manufacture of ECBN-HCl and API for Versicordepending on the quality and quantity of Abbott inventions so used, asreasonably determined by Abbott.  In theevent that Abbott files a patent application on such ideas, innovations orinventions, then Abbott shall so notify Versicor within [**] of the filing ofsuch patent application.  Abbott may notuse any specific ECBN-HCl or API innovations or inventions for ECBN-HCl or APIdeveloped in the Agreement by Abbott or Versicor to develop or manufacture anyglucan synthase inhibitors for any third party other than Versicor during theterm of this Agreement, and for a [**] period thereafter; provided, however, thatAbbott shall be entitled to use any innovations or inventions developed byAbbott hereunder for Abbott’s own purposes; provided, however, that such Abbottinventions and/or innovations shall not include any Versicor Patent Rights,Versicor Know-How or API.

             10.3      **Versicor Inventions**.  During the term of this Agreement, Versicor hereby grants to Abbott aroyalty-free, worldwide, nonexclusive license, with the right to grantsublicenses to satisfy Abbott’s manufacturing obligations hereunder, to Versicor Confidential Information, Versicor Know-How, Versicor Patent Rights, and otherproprietary rights reasonably necessary to conduct the research and developmentwork described in Articles 3 and 4 hereof, and to make, have made, import, selland supply ECBN-HCl and/or API hereunder, but only for such purposes.  In the event that Abbott desires to use athird party in the manufacture of ECBN-HCl and/or API, Abbott shall notifyVersicor in advance of such use in order to obtain Versicor’s approval of suchthird party manufacturer, which approval shall not be unreasonablywithheld.  Versicor shall have [**] toapprove or reject such third party manufacturer.  Failure of Versicor to respond in writing with such [**] timeperiod shall be deemed a rejection of that third party manufacturer.  Abbott shall only use Versicor approvedthird party manufacturers in the manufacture of ECBN-HCl and/or API.

11.        **Confidential Information**.

             Neither party shall use or discloseany Confidential Information received by any third party contract entered intoby Abbott and that party shall contain a provision to allow Versicor to auditsuch facilities pursuant to this Agreement without the prior written consent ofthe other party.  Except as provided inthe following sentence, nothing contained in this Article shall be construed torestrict the parties from disclosing Confidential Information as is reasonablynecessary to perform acts permitted by this Agreement.  However, if either party is required orfeels it necessary to disclose any Confidential Information received by itpursuant to this Agreement (whether by audit or otherwise) to any third partyor governmental agency in compliance with any federal, state and/or local lawsand/or regulations, or pursuant to an order of a court of competentjurisdiction, the disclosing party shall notify the party owning suchConfidential Information immediately, prior to any such disclosure, in order toenable the owning party to protect its Confidential Information.  In any event, the disclosing party shallmake any disclosures of Confidential Information received by it pursuant tothis Agreement only to the extent required, and only to such persons who have aneed to know.  The obligations of theparties relating to Confidential Information shall expire [**] aftertermination of this Agreement.

12.        **Termand Termination**.

             12.1      **Term**.  This Agreement shall become effective as ofthe Effective Date, and unless sooner terminated hereunder, shall continue ineffect until the completion of the [**] Contract Year following the Launch Date.  **THISAGREEMENT MAY BE TERMINATED UPON EXPIRATION OF SUCH****[**]****TERM UPON NOT LESS THAN****[**]****WRITTEN NOTICE.  THEREAFTER, THIS AGREEMENT SHALL STAY INEFFECT FOR ADDITIONAL [**] PERIODS UNLESS****[**]****PRIOR WRITTEN NOTICE OF A PARTY’SINTENT TO TERMINATE IS GIVEN TO THE OTHER PARTY.**

             12.2      **Versicor TerminationRights**.  Versicor mayterminate the Project upon [**] prior written notice to Abbott if Versicordetermines in good faith that the clinical, development and/or commercial stageof the ECBN-HCl and/or API, before or after the Launch Date, is nottechnically, clinically or commercially feasible, as determined byVersicor.  If the Project is terminated,Abbott shall advise Versicor of Abbott’s actual research and development costson the Project incurred prior to such termination.  If Versicor disputes such amount, the dispute shall be resolvedin accordance with the provisions of Section 18.2 hereof.  The parties shall negotiate in good faith anappropriate adjustment based upon Abbott’s actual costs and Versicor’s paymentsto Abbott to support the Project. Abbott, if requested by Versicor, shall provide to Versicor a summary ofcosts payable pursuant to this Section 12.2. Upon payment of any adjustment required by this Section 12.2, thisAgreement shall terminate.

             12.3      **Abbott Termination Rights**.  In the event Versicor elects not to launchProduct by [**], Abbott shall have the right to terminate thisAgreement.

             12.4      **General Termination Rights**.  Upon the occurrence of the following events,either party may terminate this Agreement by giving the other party [**] priorwritten notice:
|   | a.     | Upon the bankruptcy  or insolvency of the other party; or                                                                                                          |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                               |
|   | b.     | Upon the material  breach of any provision of this Agreement by the other party if the breach is  not remedied prior to the expiration of such [**] notice period. |

             12.5      **Termination in Event of Hardship**.  In the event that during the term of thisAgreement the general situation and/or the data and/or economic appropriatenesson which this Agreement is based are substantially changed such that it is notcommercially reasonable for either party to proceed towards commercializationof the Product, such party may, after good faith negotiations between theparties, terminate this Agreement with [**] prior written notice to the otherparty; provided, however, that in the event that Versicor subsequently proceedstoward the commercialization of Product, Abbott shall be entitled tomanufacture the ECBN-HCl and API for such Product at the price and upon theterms and conditions set forth in this Agreement.

             12.6      **Survival Provisions**.  Termination, expiration, cancellation orabandonment of this Agreement through any means and for any reason shall notrelieve the parties of any obligation accruing prior thereto, including, butnot limited to, the obligation to pay money, and shall be without prejudice tothe rights and remedies of either party with respect to the antecedent breachof any of the provisions of this Agreement. Further, Articles 10,11, 12, 13,14, 15, 16,  20 and 25 shall survive thetermination of this Agreement.

13.        **Warranties**

             13.1      **Versicor Warranties**.  Versicor warrants to Abbott that VersicorPatent Rights, Versicor Know-How, and Confidential Information provided byVersicor to Abbott for use in the research and development work described inthis Agreement and for Abbott to manufacture and supply ECBN-HCl and API underthis Agreement do not, and will not for the term hereof, infringe any patent orother proprietary right of any third party. Versicor warrants that it owns orcontrols all of the rights, title and interest in and to the Versicor PatentRights, Versicor Know-How, and Confidential Information provided by Versicor toAbbott hereunder, and that it has the full right and authority to grant toAbbott the license described in Section 10.2. Versicor further warrants that such license constitutes the only licensethat Abbott will need to manufacture and supply ECBN-HCl and API for Versicor,its Affiliates, subsidiaries, licensees and sublicensees.

             13.2      **Abbott Warranties**. Abbott warrants to Versicor that Abbott Patent Rights, Abbott Know-How,and Confidential Information provided by Abbott for use in the research anddevelopment work described in this Agreement and the manufacture and supply ofECBN-HCl and API under this Agreement do not, and will not for the term hereof,infringe any patent or other proprietary right of any third party.  Abbott warrants to Versicor that ECBN-HCland API delivered to Versicor pursuant to this Agreement shall conform to cGMPand the Specifications, and shall be in compliance with applicable laws andregulations.  **ABBOTT MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TOECBN-HCl OR API.  ALL OTHER WARRANTIES,EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES ORMERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY DISCLAIMED BYABBOTT.  IN NO EVENT SHALL ABBOTT BELIABLE FOR INDIRECT, INCIDENTAL OR****CONSEQUENTIALDAMAGES, INCLUDING WITHOUT LIMITATION, LOST REVENUES OR PROFITS.**

14.        **Indemnification**.

             14.1      **Versicor Indemnification**.  Versicor shall defend, indemnify and holdAbbott and its Affiliates and their respective employees, consultants,directors and agents harmless against any liability, judgment, demand, action,suit, loss, damage, cost and other expense (including reasonable attorney'sfees) (”Liability") arising from (i) Versicor’s negligence or willful actor omission in the development, testing, use, manufacture, promotion,marketing, sale, distribution, packaging, labeling, handling, storage, and/ordisposal of ECBN-HCl and/or API and/or Product; or (ii) any action brought by athird party alleging infringement of any patent or other proprietary rights ofsuch third party by use of the Versicor Patents, Versicor Know-How, orConfidential Information provided by Versicor; or (iii) Versicor’s and/or anyVersicor’s Affiliate’s, licensee’s and/or sublicensee’s material breach of thisAgreement, except to the extent Abbott is liable under Section 14.2.

             14.2      **Abbott Indemnification**.  Abbott shall defend, indemnify and holdVersicor, its Affiliates, licensees and sublicensees and their respectiveemployees, consultants, directors and agents harmless against any Liabilityarising from (i) Abbott’s negligence or willful act or omission in thedevelopment, testing, use, storage, handling, manufacture, storage or deliveryof ECBN-HCl and/or API; (ii) any action brought by a third party alleginginfringement of any patent or other proprietary rights of such third party byuse of the Abbott Patents, Abbott Know-How, or Confidential Informationprovided by Abbott; or (iii) Abbott’s material breach of this Agreement, exceptto the extent Versicor is liable under Section 14.

             14.3      **Claims and Proceedings**.  Each party shall notify the other promptlyof any threatened or pending claim or proceeding covered by any of the aboveSections in this Article 14 and shall include sufficient information to enablethe other party to assess the facts. Each party shall cooperate fully with the other party in the defense ofall such claims.  No settlement orcompromise shall be binding on a party hereto without its prior writtenconsent.

15.        **Assignment**.

             Neither party shall assign thisAgreement or any part thereof without the prior written consent of the otherparty, which consent shall not be unreasonably withheld.  Any permitted assignee shall assume allobligations of its assignor under this Agreement.  No assignment shall relieve any party of responsibility for theperformance of any accrued obligation, which such party then has hereunder.

16.        **Notices**.

             All notices hereunder shall be inwriting and shall be delivered personally, registered or certified mail,postage prepaid, mailed by express mail service or given by facsimile, to thefollowing addresses of the respective parties:
|   | If  to Abbott:  | Abbott Laboratories                       |
|--------|-----------------|-------------------------------------------|
|   |            | President                                 |
|   |            | Specialty Products  Division              |
|   |            | Department 390,  Building A1              |
|   |            | 1401 Sheridan Road                        |
|   |            | North Chicago, IL  60064-4000             |
|   |            | Fax Number:  847/938-2315                 |
|   |            |                                      |
|   | with copy to:   | Abbott Laboratories                       |
|   |            | Senior Vice President and General Counsel |
|   |            | Department 364, Building AP6D             |
|   |            | 100 Abbott Park Road                      |
|   |            | Abbott Park, IL 60064-6049                |
|   |            | Fax Number: 847/938-6277                  |
|   |            |                                      |
|   | If to Versicor: | Versicor, Inc.                            |
|   |            | 34790 Ardentech  Court                    |
|   |            | Fremont, Ca 94555                         |
|   |            | Attention: CEO and  CFO                   |
|   |            |                                      |
|   | With a copy to  | O’Melveny &  Myers LLP           |
|   |            | 275 Battery Street,  Suite 2600           |
|   |            | San Francisco,  California 94111          |
|   |            | Attention:  Peter T. Healy, Esq.     |

Noticesshall be effective upon receipt if personally delivered, on the third businessday following the date of mailing if sent by certified or registered mail, andon the second business day following the date of delivery to the express mailservice if sent by express mail, or the date of transmission if sent by facsimile.  A party may change its address listed aboveby notice to the other party.

17.        **EntireAgreement**.

             This Agreement constitutes theentire agreement between the parties concerning the subject matter hereof andsupersedes all written or oral prior agreements or understandings with respectthereto.

18.        **Alternative Dispute Resolution and Applicable Law**.

             18.1      **Choiceof Law**.  This Agreementshall be construed, interpreted and governed by the laws of the State of NewYork, excluding its choice of law provisions.

             18.2      **Alternative DisputeResolution**.  The partiesrecognize that bona fide disputes may arise which relate to the parties’ rightsand obligations under this Agreement. The parties agree that any such dispute shall be resolved by AlternativeDispute Resolution (“ADR”) in accordance with the procedure set forth inExhibit F.

19.        **ForceMajeure**.

             Any delay in the performance of anyof the duties or obligations of any party (except the payment of money duehereunder) caused by an event outside the affected party’s reasonable controlshall not be considered a breach of this Agreement, and unless provided to thecontrary herein, the time required for performance shall be extended for aperiod equal to the period of such delay. Such events shall include without limitation, acts of God; acts of thepublic enemy; insurrections; riots; injunctions; embargoes; labor disputes,including strikes, lockouts, job actions, or boycotts; fires; explosions;floods; earthquakes; shortages of material or energy; delays in the delivery ofraw materials, or other unforeseeable causes beyond the reasonable control andwithout the fault or negligence of the party so affected.  The party so affected shall give promptnotice to the other party of such cause, and shall take whatever reasonablesteps are necessary to relieve the effect of such cause as rapidly asreasonably possible**.**

20.        **Severability**.

             If any term or provision of thisAgreement shall for any reason be held invalid, illegal or unenforceable in anyrespect, such invalidity, illegality or unenforceability shall not affect anyother term or provision hereof, and this Agreement shall be interpreted andconstrued as if such term or provision, to the extent the same shall have beenheld to be invalid, illegal or unenforceable, had never been contained herein.

21.        **Waiver**.

             No waiver or modification of any ofthe terms of this Agreement shall be valid unless in writing and signed by anauthorized representative of each party hereto.  Failure by either party to enforce any rights under thisAgreement shall not be construed as a waiver of such rights, nor shall a waiverby either party in one or more instances be construed as constituting acontinuing waiver or as a waiver in other instances.

22.        **Exhibits**.

             All Exhibits referenced herein arehereby made a part of this Agreement.

23.        **Counterparts**.

             This Agreement may be executed inany number of separate counterparts, each of which shall be deemed to be anoriginal, but which together shall constitute one and the same instrument.

24.        **No Publicity**.

             With the exception ofcommunicating, “Abbott has become the worldwide manufacturing, development andsupply partner for Versicor’s ECBN-HCl and API,” for the limited purposes ofcommunicating information (i) to Versicor’s Board of Directors, (ii) Versicorinvestors, (iii) to symposium participants in break out question and answersessions, neither party shall disclose the existence of this Agreement or theprovisions of this Agreement without the prior written approval of the other party.  Neither party shall use the name of theother party in any publicity or advertising without the other party’s priorwritten consent.  Neither party shallmake any public announcement concerning the transactions contemplated herein,or make any public statement that includes the name of the other party or anyof its Affiliates or subsidiaries, or otherwise use the name of the other partyor any of its Affiliates or subsidiaries in any public statement or document,except as may be required by law or judicial order, without the written consentof the other party, which consent shall not be unreasonably withheld.  Subject to any legal or judicial disclosureobligation, any such public announcement proposed by a party that names theother party shall first be provided in draft to the other party.

             **INWITNESS WHEREOF**, the parties hereto have caused this Agreement to beexecuted by their duly authorized representatives on the later day and yearwritten below.
| **ABBOTT LABORATORIES** |                   | **VERSICOR, INC.** |
|-------------------------|------------------------|--------------------|
|                    |                   |               |   |   |
| By:                     | /s/  Chris Kolber |               | By: | /s/George F.  Horner, III |
|                    |                        |               |   |  |
| Title:                  | DVP                    |               | Title: | President and CEO |
|                    |                        |               |   |  |
| Date:                   | 6/12/01                |               | Date: | 25 June 2001 |
|                    |                        |               |   |  |

**EXHIBIT A**

**API**

**VER002 API**

 

Anidulafungin(VER002) API StructureChemical name:  [**]

 

 

[**]

**EXHIBIT B**

**EBCN-HCl**

 

 

 

[**]

 

 

 

 

 

[**]

 

 

 

 

 

 

ChemicalName:  [**]

**EXHIBIT C**

**ECBN-HCl AND/OR API SPECIFICATIONS**

| **Analytical Property** | **Method Type/Code** |   | **Limit** |
|-------------------------|----------------------|--------|-----------|
| ****                    | ****                 | ****   | ****      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |
|                    |                 |   |      |
| [**]                    | [**]                 |   | [**]      |

 

**EXHIBITD**

**PROPOSALS**

LY303366 PROPOSALVersicor - ABBOTT LABORATORIESPIII CHEMICAL PRODUCTION PROGRAM

 

Goals:

[**]

Abbott Activities:

[**]

Assumptions:

[**]

Summary

ProgramTimeline

[**]

Goals:

[**]

Abbott Activities:

[**]

Assumptions:

[**]

ProgramTimeline:

[**]

 

**VERSICOR CHEMICAL R&D VALIDATION PROPOSALSTAGE II**

 

[**]

 

 

** ****VERSICORCHEMICAL R&D VALIDATION PROPOSALSTAGE III**

 

[**]

 

 

**VERSICORFERMENTATION ACTIVITY LIST[**] – DAJ**

 

[**]

 

**FERMENTATIONREFERENCE STANDARDSPROPOSAL OPTIONS**

----

SCOPE:

[**].

----

BACKGROUND:

[**]

----

| SCENARIO    | START  DATE | DEMO  RUN COMPLETE | PROCESS  VALIDATION RUN #1 | PROCESS  VALIDATION RUN #2 | PROCESS  VALIDATION RUN #3 | ADDED  COST From Scen. 1 | PROJECT  DELAY From Scen. 1 |
|-------------|-------------|--------------------|----------------------------|----------------------------|----------------------------|--------------------------|-----------------------------|
|             |             |                    |                            |                            |                            |                          |                             |
| Scenario  1 | [**]        | [**]               | [**]                       | [**]                       | [**]                       | [**]                     | [**]                        |
| Scenario  2 | [**]        | [**]               | [**]                       | [**]                       | [**]                       | [**]                     | [**]                        |
| Scenario  3 | [**]        | [**]               | [**]                       | [**]                       | [**]                       | [**]                     | [**]                        |
| Scenario  4 | [**]        | [**]               | [**]                       | [**]                       | [**]                       | [**]                     | [**]                        |

 

Scenario1        [**]

Scenario2        [**]

Scenario3        [**]

Scenario4        [**]

ASSUMPTIONS:

[**]

DECISIONMILESTONES:

| [**]:  | Deadline  for Versicor to select the optimal scenario in order for Abbott to maintain  the appropriate timelines posted in the above table.  *Note:  if a decision is made sooner or later, the  timelines will be affected accordingly.* |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                |
| [**]:  | Deadline  for Abbott to receive reference standards in order to maintain project timing  in Scenarios 2-4.                                                                                                                                          |

AdditionalComments:

•            [**]

•            [**]

•            [**]

**EXHIBITE**

 

**PROGRAMTIME GAITED COSTS**($000s)All dates are estimated and actual activity dates are subject to change

| **Activity** | **Start Date** | **End Date** | **Actual [**]** | **Projected****[**]** | **Projected****[**]** | **Projected****[**]** |
|--------------|----------------|--------------|-----------------|-----------------------|-----------------------|-----------------------|
|              |                |              |                 |                       |                       |                       |
| [**]         |           |         | [**]            |                  |                  |                  |
| [**]         |           |         | [**]            |                  |                  |                  |
| [**]         |           |         | [**]            |                  |                  |                  |
|         |           |         |            |                  |                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
| [**]         | [**]           | [**]         |            |   [**]           |                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
| [**]         | [**]           |         |            | [**]                  |                  |                  |
| [**]         |           |         |            |                  | [**]                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
| [**]         | [**]           |         |            | [**]                  |                  |                  |
| [**]         |           | [**]         |            |                  | [**]                  |                  |
| [**]         | [**]           | [**]         |            |    [**]     |                  |                  |
| [**]         | [**]           | [**]         |            | [**]                  |                  |                  |
|         |           |         |            |                  |                  |                  |
| [**]         | [**]           | [**]         |            |                  | [**]                  |                  |
| [**]*        | [**]           | [**]         |            |                  | [**]                  |                  |
| [**]*        | [**]           | [**]         |            |                  | [**]                  |                  |
| [**]         | [**]           | [**]         |            |                  | [**]                  |                  |
| [**]         |           |         |            |                  |                  | [**]**                |
| [**]         |           |         | [**]            | [**]                  | [**]                  | [**]**                |

**                                                                                                                                                                TotalProgram Cost           [**]**

*Invoices shall be sent toVersicor upon the completion of each line item activity above unless specifiedas project initiation; Upon such event, invoices shall be sent on theinitiation date of said activity.*

[**].

[**].

*Activitiesto include the cGMP production of approx. [**] of Commercial validationmaterial.**Miscellaneous program charges if reference standard production fees areincurred in [**].  Abbott shall adjustthe timing of other fees accordingly to assure that the total annual charges donot exceed the total annual charges listed above.*

**EXHIBIT F**

**Alternative Dispute Resolution**

Theparties recognize that from time to time a dispute may arise relating to eitherparty’s rights or obligations under this Agreement.  The parties agree that any such dispute shall be resolved by theAlternative Dispute Resolution (“ADR”) provisions set forth in this Exhibit,the result of which shall be binding upon the parties.

             To begin the ADR process, a partyfirst must send written notice of the dispute to the other party for attemptedresolution by good faith negotiations between their respective presidents (ortheir designees) of the affected subsidiaries, divisions, or business unitswithin [**] after such notice isreceived (all references to “days” in this ADR provision are to calendardays).  If the matter has not been resolvedwithin [**] of the notice ofdispute, or if the parties fail to meet within such [**], either party may initiate an ADR proceeding asprovided herein.  The parties shall havethe right to be represented by counsel in such a proceeding.

1.          To begin an ADR proceeding, a partyshall provide written notice to the other party of the issues to be resolved byADR.  Within [**] after its receipt of such notice, the otherparty may, by written notice to the party initiating the ADR, add additionalissues to be resolved within the same ADR.

2.          Within [**] following receipt of the original ADR notice,the parties shall select a mutually acceptable neutral to preside in theresolution of any disputes in this ADR proceeding.  If the parties are unable to agree on a mutually acceptableneutral within such period, either party may request the President of the CPRInstitute for Dispute Resolution (“CPR”), 366 Madison Avenue, 14th Floor, NewYork, New York  10017, to select a neutralpursuant to the following procedures:

(a)            The CPR shall submit to the partiesa list of not less than [**] candidates within [**] after receipt of the request, along with a *CurriculumVitae* for each candidate.  Nocandidate shall be an employee, director, or shareholder of either party or anyof their subsidiaries or affiliates.

(b)            Such list shall include a statementof disclosure by each candidate of any circumstances likely to affect his orher impartiality.

(c)            Each party shall number thecandidates in order of preference (with the number one (1) signifying thegreatest preference) and shall deliver the list to the CPR within [**] following receipt of the list ofcandidates.  If a party believes aconflict of interest exists regarding any of the candidates, that party shallprovide a written explanation of the conflict to the CPR along with its listshowing its order of preference for the candidates.  Any party failing to return a list of preferences on time shallbe deemed to have no order of preference.

(d)            If the parties collectively haveidentified fewer than [**] candidates deemed tohave conflicts, the CPR immediately shall designate as the neutral thecandidate for whom the parties collectively have indicated the greatestpreference.  If a tie should resultbetween two candidates, the CPR may designate either candidate.  If the parties collectively have identified [**] or more candidates deemed to have conflicts,the CPR shall review the explanations regarding conflicts and, in its solediscretion, may either (i) immediately designate as the neutral the candidatefor whom the parties collectively have indicated the greatest preference, or(ii) issue a new list of not less than [**] candidates, in which case the procedures setforth in subparagraphs 2(a) - 2(d) shall be repeated.

3.          No earlier than [**] or later than [**] after selection, the neutral shall hold ahearing to resolve each of the issues identified by the parties.  The ADR proceeding shall take place at alocation agreed upon by the parties.  Ifthe parties cannot agree, the neutral shall designate a location other than theprincipal place of business of either party or any of their subsidiaries oraffiliates.

4.          At least [**] prior to the hearing, each party shall submitthe following to the other party and the neutral:

(a)             a copy of all exhibits on whichsuch party intends to rely in any oral or written presentation to the neutral;

(b)            a list of any witnesses such partyintends to call at the hearing, and a short summary of the anticipatedtestimony of each witness;

(c)             a proposed ruling on each issue tobe resolved, together with a request for a specific damage award or otherremedy for each issue. The proposed rulings and remedies shall not contain anyrecitation of the facts or any legal arguments and shall not exceed one (1)page per issue.

(d)            a brief in support of such party’sproposed rulings and remedies, provided that the brief shall not exceed [**] pages. This page limitation shall apply regardless of the number of issuesraised in the ADR proceeding.

Exceptas expressly set forth in subparagraphs 4(a) - 4(d), no discovery shall berequired or permitted by any means, including depositions, interrogatories,requests for admissions, or production of documents.

5.          The hearing shall be conducted on [**] and shall be governed by the following rules:

(a)             Each party shall be entitled to [**] of hearing time to present its case.  The neutral shall determine whether eachparty has had the [**] to which it isentitled.

(b)             Each party shall be entitled, butnot required, to make an opening statement, to present regular and rebuttaltestimony, documents or other evidence, to cross-examine witnesses, and to makea closing argument.  Cross-examinationof witnesses shall occur immediately after their direct testimony, and cross-examinationtime shall be charged against the party conducting the cross-examination.

(c)              The party initiating the ADR shallbegin the hearing and, if it chooses to make an opening statement, shalladdress not only issues it raised but also any issues raised by the respondingparty.  The responding party, if itchooses to make an opening statement, also shall address all issues raised inthe ADR.  Thereafter, the presentationof regular and rebuttal testimony and documents, other evidence, and closingarguments shall proceed in the same sequence.

(d)             Except when testifying, witnessesshall be excluded from the hearing until closing arguments.

(e)              Settlement negotiations, includingany statements made therein, shall not be admissible under anycircumstances.  Affidavits prepared forpurposes of the ADR hearing also shall not be admissible.  As to all other matters, the neutral shallhave sole discretion regarding the admissibility of any evidence.

6.          Within [**] following completion of the hearing, each partymay submit to the other party and the neutral a post-hearing brief in supportof its proposed rulings and remedies, provided that such brief shall notcontain or discuss any new evidence and shall not exceed [**] pages. This page limitation shall apply regardless of the number of issuesraised in the ADR proceeding.

7.          The neutral shall rule on eachdisputed issue within [**] following completion ofthe hearing.  Such ruling shall adopt inits entirety the proposed ruling and remedy of one of the parties on eachdisputed issue but may adopt one party’s proposed rulings and remedies on someissues and the other party’s proposed rulings and remedies on otherissues.  The neutral shall not issue anywritten opinion or otherwise explain the basis of the ruling.

8.          The neutral shall be paid a reasonablefee plus expenses.  These fees andexpenses, along with the reasonable legal fees and expenses of the prevailingparty (including all expert witness fees and expenses), the fees and expensesof a court reporter, and any expenses for a hearing room, shall be paid asfollows:

(a)        If the neutral rules in favor of oneparty on all disputed issues in the ADR, the losing party shall pay 100% ofsuch fees and expenses.

(b)             If the neutral rules in favor ofone party on some issues and the other party on other issues, the neutral shallissue with the rulings a written determination as to how such fees and expensesshall be allocated between the parties. The neutral shall allocate fees and expenses in a way that bears a reasonablerelationship to the outcome of the ADR, with the party prevailing on moreissues, or on issues of greater value or gravity, recovering a relativelylarger share of its legal fees and expenses.

9.          The rulings of the neutral and theallocation of fees and expenses shall be binding, non-reviewable, andnon-appealable, and may be entered as a final judgment in any court havingjurisdiction.

10.        Exceptas provided in paragraph 9 or as required by law, the existence of the dispute,any settlement negotiations, the ADR hearing, any submissions (includingexhibits, testimony, proposed rulings, and briefs), and the rulings shall bedeemed Confidential Information.  Theneutral shall have the authority to impose sanctions for unauthorizeddisclosure of Confidential Information.

 

[**]The confident portion has been omitted and filed separately with the Securitiesand Exchange Commission